The share of Iran’s armed forces from the revenues of “oil and gas exports in the government’s general budget” will be 51%, according to the details of the 2025 budget bill.
According to the budget bill submitted to parliament by Iranian regime President Massoud Pezeshkian on Tuesday, October 22, the government’s share of total oil and gas exports next year will be 37.5%, equivalent to 12 quadrillion rials (approximately $17.977 billion).
Out of this amount, 5.61 quadrillion rials (approximately $8.4 billion), equivalent to 51%, will go to the armed forces “to strengthen the country’s defense capabilities.” This figure is more than four times higher than the current year’s budget allocation of 1.34 quadrillion tomans (approximately $2.007 billion).
Due to significant changes in the structure of next year’s budget, including shifts in budgetary and off-budget items, it remains unclear exactly how the armed forces’ share of the total state budget will change compared to this year. It is also uncertain whether the increase in their share from oil revenues will affect other budget lines related to the military.
Calculations suggest that the value of the Iranian armed forces’ budget in 2024 is at least $17 billion.
The oil export figures in next year’s general budget are calculated in euros, with a notable shift in the exchange rate from 310,000 rials per euro this year to over 500,000 rials per euro next year. Currently, the market rate for one euro is around 720,000 rials.
If calculated in euros, the government is expected to provide 4.5 billion euros in oil for the armed forces to export this year, with this figure rising to over 9 billion euros next year—a 100% increase compared to this year and a 144% increase compared to last year.
Total oil and gas exports of the country
The government has not specified an exact figure for oil exports in next year’s budget, but overall projections suggest that the total value of the country’s oil and gas exports will be around 30 quadrillion rials (approximately $45 billion), equivalent to 60 billion euros at the set exchange rate. However, as mentioned, the euro’s market value is higher than the budget rate.
Of this amount, approximately 5 billion euros will come from gas exports and 55 billion euros from oil and petroleum products.
The government’s share of oil and gas export revenues will be around 37.5%, in addition to the full revenue from the export of petroleum products.
Last year, Iran exported approximately $37 billion (€35 billion) worth of oil, and in the first half of this year, this figure reached $24 billion.
It is not exactly clear how the government expects to raise this figure to 55 billion euros next year. The oil price in next year’s budget bill is set at €57.5 per barrel, which is not significantly different from this year’s budget law.
Nevertheless, while the budget does not mention oil export volumes, the country’s crude oil production is projected to reach 3.75 million barrels per day, which is 350,000 barrels more than the current level.
The real share of different sectors from oil revenues
As mentioned, 37.5% of the total oil and gas export revenues will go to the government. Around 14.5% will go to the National Iranian Oil Company, and 48% will be allocated to the National Development Fund.
However, a clause in the 2025 budget bill stipulates that 28% of the National Development Fund’s share of oil export revenues will be lent to the government. This means that effectively, the government’s share of oil revenues—both direct and through borrowing from the National Development Fund—will reach 65.5%, while 14.5% will go to the National Iranian Oil Company, and the remaining 20% will go to the National Development Fund.
The total oil budget revenues of the government, including both exports and domestic markets, are projected to reach 21 quadrillion rials (approximately $31.46 billion) next year, which is 32% higher than last year.
Thus, 57% of the government’s oil budget will rely on foreign markets, while 43% will depend on domestic markets.
